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Yes, absolutely. Thanks, convener.

Thank you very much. I have heard suggestions from elsewhere that there are interpersonal issues on the NJNC—that largely the same group of people have sat on either side of the table for too long, which has built up personal challenges that are perhaps contributing to these tensions. From what you have both said this morning, it sounds as though, from your perspective, that is not necessarily the case, but that the issues are perhaps further upstream, on the employer side. Stuart, would it be correct to characterise your position as being that NJNC negotiations work well and that there are not necessarily any profound interpersonal issues there, but that the challenges are when the employer side negotiators go back to the employers association to get ratification of whatever agreement has been struck in the room?

Thank you very much.

I will return to Daniel Johnson’s line of questioning on productivity and wage growth. I asked the SFC, but by that point you were outside the door, so you probably missed that.

The SFC’s assumptions about increasing productivity are based on more people getting into the right jobs; in other words, more productive, higher paid jobs. The workforce will not increase, as we have just discussed, which means that either low-wage sectors need to become higher wage—so wages in sectors such as retail, hospitality and tourism need to go up—or there will be a continued exodus from those sectors into higher wage sectors.

In terms of the Government’s overall strategic priorities for the economy, what balance of those two trends would you like to see? We already have acute labour shortages in those sectors, which is usually tied to wage issues. Is it more of a priority to grow high wage sectors or try to raise wages in those existing sectors where there are shortages because of those issues?

If that is the case, would it be fair to say that the strategic priority for, say, Scottish Enterprise—which is issuing grants from a fixed budget—is far more aligned with targeting grant offers, with attached fair work conditions, at low-wage sectors, than with issuing grants to businesses that are already in a high-wage sector?

The difference of opinion is just on how to define growth; it is not—at all—on the principle of growth.

I will stick with that spirit of high-level assumptions. I have one final high-level question, which is probably just to ask you to pull together various points that have already been made. In its precursor to the spending review, the Institute for Fiscal Studies said that, in essence, the cabinet secretary had the options of “axing, taxing, and hoping”. “Hoping” would involve kicking the can down the road and hoping that more money would somehow appear later. It boils down to the choice between making difficult decisions now or just hoping that things will get easier in the future. On balance, do you think that the spending review was a successful exercise, if the measure was making difficult decisions now, or is a high level of can kicking still going on?

Taking on board what you have just said about it being difficult to predict what the impact of the pandemic would have been on various sectors, I want to press you on one element of that, but not on a specific sector. Are those assumptions based more on assumed growth in existing high-wage sectors or on an increase in the average wage in low-wage sectors such as retail and hospitality? What is the balance? Are you assuming that there will be an improvement in pay in the low-wage sectors or that people will continue to move out of them into existing high-wage areas?

Thanks. I can see the cabinet secretary at the door, so I will wind up my questions there, convener.

How do I follow that?

So much has been covered already, so I have only two questions this morning, the first of which goes back to Daniel Johnson’s theme of productivity and, specifically, the assumptions that you have made about this year’s inflection point, which is in figure 3.13, and the growth in productivity. David Ulph said that the assumption is not about getting more people into jobs, because unemployment is low, but about getting more people into the right jobs.

The highest-profile examples of labour shortages during the past year or so have not been in particularly high wage sectors. Retail and hospitality have been some of the biggest examples. Could you expand on the assumptions that you are making about that rearrangement within the labour market? From what you said previously, I take it that there will be sectoral winners and losers, because it is not about reducing unemployment, which is already quite low, but some sectors will end up with labour shortages as a result of workers moving into the sectors that will result in the kind of productivity growth that you are assuming. Could you expand a little bit on the underlying assumptions there?